TSMC-backed design house adopts ASIC model

SANTA CLARA, Calif.—Global Unichip Corp. (GUC), a 13-year old design services vendor with close ties to Taiwan Semiconductor Manufacturing Co. (TSMC), has revamped its business model to focus on becoming a flexible, full-service fabless ASIC vendor, the company said Wednesday (Oct. 26).

According to Jim Lai, president and CEO of GUC, the company has gradually been evolving toward being a fabless ASIC vendor for the past several years. Over the past few years, GUC has dedicated significant resources to developing advanced technology, low-power design expertise, IP and system-in-package technology, Lai said in an interview at the ARM Techcon show here. GUC's offerings now include front-end design, implementation and manufacturing services, he said.

"We think it's about time for us to reposition ourselves from the design services camp to the ASIC camp," Lai said.

TSMC, GUC's largest shareholder, owns about 36 percent of the company, according to Lai. TSMC previously held nearly half of GUC when it initially invested in the firm in 2003, but over time TSMC's stake in the company has been diluted, Lai said. GUC went public in 2006.

GUC partners exclusively with TSMC and does not work with other foundry vendors, Lai said. Many of GUCs executives—including Lai, a former North America sales director at TSMC—as well as a large portion of the company's engineers were transferred from TSMC when TSMC initially invested in the company, Lai said. TSMC's vice chairman, F.C. Tseng, is chairman of GUC.

GUC's close relationship with TSMC allows GUC to bring a high-level of expertise to customer design projects, Lai said. "We know the technology better than many customers themselves," Lai said.

GUC tapes out between 60 and 70 chips per year, according to Lai. In 2010, the company had revenue of $327 million, up from $252 million in 2009, Lai said. Through September, GUC has sales of $234 million this year, he said. The company has approximately 500 employees, he said.

According to market research firm Gartner Inc., GUC ranked No. 14 in 2010 in ASIC revenue, up from 16 in 2009. The companies ranked ahead of GUC in ASIC revenue are largely vendors who mostly market their own products, something Lai said will give GUC a leg up.

"Going forward, we believe with our model and our relationship with TSMC, we will be a better alternative," Lai said.

Lai said GUC is one of the few companies that have produced 28-nm designs. In the first half of this year, GUC derived 9 percent of its revenue from 40-nm designs and 38 percent from 65-nm designs, he said.